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Spoilage Cutter Co., Inc. v. World Kitchen

August 19, 2010

THE SPOILAGE CUTTER COMPANY, INCORPORATED, D/B/A MARTOR, USA, PLAINTIFF,
v.
WORLD KITCHEN, LLC, DEFENDANT.



The opinion of the court was delivered by: Judge Robert W. Gettleman

MEMORANDUM OPINION AND ORDER

Plaintiffs, The Spoilage Cutter Company Incorporated, d/b/a Martor USA ("Martor USA") and Martor KG (collectively, "Martor"), have brought a three count Third Amended Complaint ("Complaint") against defendant World Kitchen, LLC ("World Kitchen") alleging patent infringement and breach of contract, or alternatively, unjust enrichment. World Kitchen challenged Martor's standing to bring an action for infringement, alleging that Martor did not own the patent in question. This court has already determined that Martor has standing to bring this action. The Spoilage Cutter Co. v. World Kitchen, LLC, No. 08 C 1263 (N.D. Ill. Jan. 27, 2010). In World Kitchen's Answer to the Third Amended Complaint defendant World Kitchen denies each count, raises twelve affirmative defenses, and counterclaims alleging non-infringement, patent invalidity, breach of contract, unenforceability of certain provisions of the contract, and that this is an exceptional case meriting an award of attorneys' fees and costs.

Martor has now moved for partial summary judgment on its claim that World Kitchen materially breached the contract, and on World Kitchen's counterclaim that Martor breached the contract. Additionally, Martor moved to strike portions of World Kitchen's Statement of Facts. World Kitchen has also moved for summary judgment on its counterclaims of non-infringement, invalidity, and breach of contract. For the reasons stated below, the court grants World Kitchen's motion for summary judgment of non-infringement and breach of contract but denies World Kitchen's motion for summary judgment of invalidity and attorneys' fees. The court partially grants Martor's motion to strike portions of World Kitchen's statement of facts in support of summary judgment. The court further denies Mortar's motion for partial summary judgment for breach of contract.

BACKGROUND

In 2005, Martor USA filed suit against World Kitchen alleging that its FLEX-GUARD(r) SK-6 safety cutter infringed U.S. Patent No. 6,148,520, entitled "Box Cutter with Autoretracting Blade" ("the '520 patent").*fn1 On November 11, 2005, the parties entered into a Settlement Agreement and Mutual Release ("Settlement Agreement") resolving that dispute. In that Settlement Agreement, Martor granted World Kitchen a covenant not to sue, and World Kitchen agreed that it would not make a safety cutter that included the autoretraction mechanism of the '520 patent.

In 2007, World Kitchen began selling a safety cutter in the United States known as the OLFA(r) SK-8 ("SK-8"). On March 3, 2008, Martor filed the instant action alleging that World Kitchen's sales of the SK-8 infringe one or more claims of U.S. Patent No. 6,785,966, entitled "Box Cutter with Autoretracting Blade" ("the '966 patent") and breach the terms of the Settlement Agreement. The '966 patent issued in 2004 and is directed to an improvement that enabled box cutter blades to autoretract in modes of use not contemplated by the technology of the earlier issued '520 patent.

DISCUSSION

I. Legal Standard

A movant is entitled to summary judgment under Rule 56 when the moving papers and affidavits show there is no genuine issue of material fact and the movant is entitled to judgment as a matter of law. See Fed.R.Civ.P. 56(c); Celotex Corp. v. Catrett, 477 U.S. 317, 322, 106 S.Ct. 2548, 91 L.Ed.2d 265 (1986); Unterreiner v. Volkswagen of Am., Inc., 8 F.3d 1206, 1209 (7th Cir.1993).

II. Motion to Strike

Martor has moved to strike two of World Kitchen's exhibits, a demonstrative DVD with a slide presentation highlighting the operation of the SK-8 as it relates to the '966 patent (Exhibit 200) and an additional declaration by expert witness Dr. Karvelis (Exhibit 202), because they were allegedly filed after the close of discovery in violation of Federal Rule of Civil Procedure 26 (a)(2)(C). Additionally, Martor has moved to strike paragraphs 203, 205--06, 209--10, 213--17, 221, 226--27, 234, 236, 238, 240--44, and 246 of World Kitchen's statement of undisputed facts in support of its motion for summary judgment. Martor argues that those paragraphs contain improper opinions, speculation, arguments, or legal conclusions in violation of Fed. R. Civ. P. 56 and Local Rule 56.1.

World Kitchen responds by noting that: 1) the substance of Exhibit 200 is not new and it was subject to full discovery; 2) each of the paragraphs in Exhibit 202 is supported verbatim or in substance by one of Dr. Karvelis' previous declarations; 3) the assertions in all of the paragraphs of its Statement of Material Facts are proper in a patent infringement and validity case as well as a breach of contract case; and 4) World Kitchen is entitled to attorney's fees for responding to what it considers a groundless motion.

A. Exhibits 200 and 202

Federal Rules of Civil Procedure 26(a)(2)(B) and (C) establish the requirements for written expert opinions. Specifically, an expert must submit to the opposing party "a complete statement of all opinions the witness will express and the basis and reasons for them."

Fed.R.Civ.P. 26(a)(2)(B)(I). The report must also include "any exhibits that will be used to summarize or support [the expert's opinions]." Fed.R.Civ.P. 26(a)(2)(B)(iii). Further, the party submitting the report must disclose the report "at the time[] and in the sequence that the court orders." Fed.R.Civ.P. 26(a)(2)(C).

In the instant case, the court ordered a discovery cut-off date of July 8, 2009. At that time, discovery was complete and no further submission of expert exhibits was appropriate. World Kitchen submitted Exhibits 200 and 202 on September 11, 2009, along with its motion for summary judgment. Consequently, the exhibits were not timely. World Kitchen's contention that the exhibits contained no new material is irrelevant. Martor's motion to strike is granted with regard to Exhibits 200 and 202.

B. Paragraphs 203, 205--06, 209--10, 213--17, 221, 226--27, 234, 236, 238, 240--44, and 246

Local Rule 56.1 requires that a moving party submit "a statement of material facts as to which moving party contends there is no genuine issue and that entitle the moving party to a judgment as a matter of law." L.R. 56.1(a)(3). The document should include "specific references to the affidavits, parts of the record, and other supporting materials relied upon to support the facts set forth in that paragraph." L.R. 56.1. The statement cannot satisfy the requirements of L.R. 56.1 if the statement is not supported by evidence. Id.

In a motion for summary judgment of patent invalidity for obviousness, the moving party must identify what would have been obvious to a person having ordinary skill in the art, and to support this assertion the moving party must cite the opinion of a person having ordinary skill in the art. 35 U.S.C. § 103. Both Mr. Godsted and Dr. Karvelis, the experts in the instant case, are persons having ordinary skill in the art. Therefore, statements supported by Mr. Godsted and Dr. Karvelis in World Kitchen's motion for summary judgment properly assert opinions of persons having ordinary skill in the art to support the position of obviousness. Accordingly, Martor's Motion to Strike regarding paragraphs 203, 214--17, 226--27, 234, 236, 238, 240, and 246 is denied.

Because Martor's Motion to Strike was granted with regard to Exhibits 200 and 202, paragraphs that cite only those exhibits in World Kitchen's Statement of Facts are unsupported by the record. In World Kitchen's Response to Martor's Motion to Strike, it identified additional support for the each of the assertions in Exhibit 202 in Dr. Karvelis' other, timely filed, expert reports. Therefore, World Kitchen can support its statements originally citing Exhibit 202 with support from Dr. Karvelis' earlier filed expert reports for paragraphs 205--06, 209--10, 214--16, 221, 234, 241--44, and 246. Paragraph 213, however, is supported only by Exhibit 200, and Exhibit 200 is not supported by Dr. Karvelis' earlier filed expert reports. Accordingly, Martor's Motion to Strike with regard to paragraph 213 is granted but the Motion to Strike paragraphs 205--06, 209--10, 214--16, 221, 234, 241--44, and 246 is denied.

III. World Kitchen's Motion for Non-Infringement

Patent infringement analysis is a two-step process comprising the steps of, (1) interpreting the patent claims, and (2) comparing the "properly" interpreted claims with the accused device. Cybor Corp. v. FAS Techs., Inc., 138 F.3d 1448, 1454 (Fed.Cir.1998). Under the all-limitations rule, "[t]o infringe a claim, each claim [element] must be present in the accused product, literally or equivalently." Dawn Equip. Co. v. Ky. Farms Inc., 140 F.3d 1009, 1014 (Fed.Cir.1998). Summary judgment of non-infringement is proper where there is no genuine issue as to whether the accused device lacks a single claim element or its equivalent. Lockheed Martin Corp. v. Space Sys./Loral, Inc., 324 F.3d 1308, 1321 (Fed.Cir.2003).

"It is a 'bedrock principle' of patent law that 'the claims of a patent define the invention to which the patentee is entitled the right to exclude.'" Phillips v. AWH Corp., 415 F.3d 1303, 1312 (Fed.Cir.2005) (en banc) (quoting Innova/Pure Water, Inc. v. Safari Water Filtration Sys., Inc., 381 F.3d 1111, 1115 (Fed.Cir.2004)). The construction of patent claim terms is a question of law. Markman v. Westview Instruments, Inc., 52 F.3d 967, 970-71 (Fed. Cir. 1995) (en banc), aff'd, 517 U.S. 370 (1996). Generally, the words of a claim are given their "ordinary and customary meaning," which is "the meaning that the term would have to a person of ordinary skill in the art in question at the time of the invention...." Phillips, 415 F.3d at 1312-13 (citations omitted). "Importantly, the person of ordinary skill in the art is deemed to read the claim term not only in the context of the particular claim in which the disputed term appears, but in the context of the entire patent, including the specification." Id. at 1313.

"[T]he specification 'is always highly relevant to the claim construction analysis. Usually, it is dispositive; it is the single best guide to the meaning of a disputed term.'" Id. at 1315 (quoting Vitronics Corp. v. Conceptronic, 90 F.3d 1576, 1582 (Fed. Cir. 1996)). The Federal Circuit has reiterated that "[t]he construction that stays true to the claim language and most naturally aligns with the patent's description of the invention will be, in the end, the correct construction." Phillips, 415 F.3d at 1316 (quoting Renishaw PLC v. Marposs Societa' per Azioni, 158 F.3d 1243, 1250 (Fed. Cir. 1998)).

Claim 1, the only independent claim of the '966 patent, recites:

1. An autoretracting knife comprising:

(a) a housing;

(b) a blade slide carrying a blade and displaceable longitudinally in the housing between a rear retracted end position with the blade wholly received in the housing and a front extended end position with the blade extending forward from the housing and through an intermediate position, the blade having an edge directed transversely and exposed outside the housing in the extended position;

(c) a blade spring urging the blade slide continuously rearward into the retracted position;

(d) an actuator slide displaceable longitudinally in the housing independently of the blade slide between a front end position and a rear end position and provided with an externally accessible actuating formation;

(e) an actuator spring urging the actuator slide continuously into the respective rear position;

(f) coupling means including a transversely displaceable coupling member on one of the slides engageable with the other of the slides for coupling the blade slide with the actuator slide for movement of the blade slide from its retracted position into its intermediate position on displacement of the actuator slide from its rear end position into its front end position and for decoupling the slides from each other and shifting the coupling member transversely out of a path of the other slide on movement of the blade slide from its intermediate position into its extended position; and

(g) means including cam formations on the slides for displacing the blade slide into the extended position on exertion of a transverse force against the blade edge in ...


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